High-end homes, commercially dense towns to benefit.

February 20, 2012|By Samantha Marcus, Of The Morning Call

Now that the property assessments are set and the taxes divvied up, the verdict is in on winners and losers in Lehigh County as it undergoes its first real estate reassessment in more than two decades.

The changing landscape favors higher-priced properties over lower-priced ones. It also favors residential property owners in municipalities with a large volume of commercial and industrial properties, over homeowners living in a municipality that relies mostly on a residential tax base.

Countywide, taxes on most residential properties will drop in 13 of 25 municipalities, but increase in the other 12.

The reassessment itself is "revenue neutral," meaning the county collects no extra money. As values go up, millage comes down. What's changing is the burden faced by each individual taxpayer.

"This is as much a redistribution as it is a revaluation," county Executive Don Cunningham said Monday.

Allentown's large stock of commercial and industrial properties and the nearly citywide decline in values will spare most residential owners from a tax increase in 2013. But in Coopersburg, where commercial properties are more scarce, 73 percent of residential properties will see a tax increase.

Slightly more than 8,000 residential properties in Allentown will see a tax hike, but for the majority the change will be less than 10 percent. Whitehall, Lower Macungie, Upper Macungie and South Whitehall townships similarly benefited from their businesses.

Countywide, industrial and commercial property increased in value 70 percent, according to data provided by Director of Administration Tom Muller.

Although helpful to residential property owners, increases in property values for businesses can be harmful to them in a tough economy. Commercial and industrial properties ranging from multinational corporations to neighborhood businesses, Cunningham warned, will have difficulty absorbing a large tax hike.

Municipalities facing the most tax increases include Coplay, Heidelberg Township, Lynn Township, Alburtis, Catasauqua, Coopersburg, Emmaus and Macungie. On the whole, more than 45,000 residential property owners will see a tax increase; 964 will increase greater than 50 percent.

Property owners in the northwestern townships face among the highest likelihood of tax increases because they're largely rural, farming communities with a less diverse tax base to soak up the property tax burden.

They're joined by the county's smallest communities, such as Alburtis, Catasauqua, Coopersburg, Coplay, Emmaus, Macungie and Slatington, that likewise are without a large volume of industrial or commercial properties.

And for Alburtis, largely a bedroom community with just a few small businesses in town, the result is a tax increase for 68.1 percent of residential property owners.

"I am concerned because more people are going to be paying more taxes," said Steven Hill, Alburtis Council president. "There's a lot of people on fixed income and they're going to be the hardest hit. I know there's going to be some people who are going to be very upset. I'm sure there's going to be a lot of appeals, and I hope everybody realizes they have the right to appeal."

Countywide the value of high-end housing fell more than mid-priced homes, resulting in wealthier suburbs seeing tax reductions at the expense of those with older, lower-priced housing.

"In a lot of cases, in areas that can least afford it, the smaller, older, working-class communities with lower-priced housing stock are going to bear the burden of the tax shift in the county," Cunningham said.

Generally homes priced higher than $250,000 dramatically decreased in value, while homes between $100,000 and $200,000 gained value and, in return, more share of the tax burden.

Taxes will decrease for 66.3 percent of residential properties in Lower Macungie, the second most-populous municipality after Allentown. But for 61.5 percent of homes worth $100,000 to $200,000, taxes are going up.

"The higher-end homes will be the winners of the equation, which is something I haven't been able to get my head around in terms of why the net result of this is a kind of reverse Robin Hood," Cunningham said.

Cunningham in January vetoed the county commissioners' unanimous vote to move ahead with the reassessment over his objections the current market represented an unfair snapshot of property values. Commissioners were eager to fix a system of assessments and tax distribution that hadn't been updated in 21 years and overturned his veto 8-1.

Property owners will be getting letters with information about their new assessments in the coming weeks.